Bad Faith Blog

Summary: Plaintiff sued title insurer upon learning of burdensome recorded easement after purchase of property. Plaintiff sought recovery for breach of contract as well as under the Consumer Protection Act, The Insurance Fair Conduct Act, negligence, and breach of the duty of good faith. Prior to filing suit, Plaintiff sought $125,000 based on diminution in value of the property due to the easement. Title insurer accepted coverage but disagreed as to damage caused by the easement. Title insurer hired expert appraiser who determined diminution in value was $25,000 and title insurer immediately offered to pay that amount. Plaintiff then demanded $100,000 settlement. Title insurer then mailed check to Plaintiff for $25,000, which was rejected and returned by Plaintiff.

Summary: Fidelity National defended its title insured, Anastasi, for several years before settling the quiet title action filed against him and paying his claim. In the bad faith action that followed, the trial court granted summary judgment which was vacated and remanded by the Intermediate Court of Appeals (ICA) which was in turn vacated and remanded by the Supreme Court of Hawaii.

Summary: Stewart Title Guarantee Company provided title insurance to Randy Spalding for nearly 420 acres in Cass County, Missouri in the amount of $1.7 million. It also provided title insurance coverage to Paul Estes for a one acre tract in the middle of the 428 acres, which Spalding and others were trying to develop. Stewart Title’s investigation showed that Estes had the superior claim, but the value assigned by Stewart Title Guarantee Company was $10,000.00 whereas Paul Estes demanded payment of $387,000.00. After a jury trial, the circuit court entered judgment in favor of Spalding in the amount of $1,100,000.00 on the policy, vexatious penalties in the amount of $110,150.00, and attorney’s fees in the amount of $81,000.00. The court rejected Stewart Title’s appeal and affirmed the judgment.

Fidelity National defended Lehman Commercial in multiple cases and settled approximately $900,000 worth of claims presented, but was unable to defeat Lehman’s claim for “bad faith breach” as a matter of law on its motion for summary judgment.